Page 102 - Crisis Communication Practical PR Strategies

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The New Dynamics of Financial Crisis 83
than words. Management do not lose credibility when they say,
‘We don’t know yet, but we are going to find out.’ And then com-
municate what they find out.
Open the door to continued communication. Financial audiences,
like nature, abhor a vacuum. Shareholders and analysts want and
need the assurance that they will be hearing regularly from man-
agement, whether the news is good or bad. It is essential that the
company commits to providing updates as events unfold. These
can take different forms – from group meetings to press releases –
depending on developments.
Be prepared. However skilled and experienced a CEO or CFO
may be in investor communication, no matter how collegial a
company’s relationships have been with stakeholders in the past, it
can be a whole different ballgame when a crisis strikes. Crisis com-
munication is by its nature more adversarial, more probing, faster
paced and less predictable. This is why all presenters should face
rigorous, ‘full-contact’ devil’s advocate questioning before any
meeting. Presentations should be well rehearsed, with attention
paid to cosmetic issues such as tone and pacing as well as to
content.

Step 2: building reputation in ‘normal time’
communication

When it comes to reputation management, we don’t get a second
chance when crisis strikes. Much of the credibility we need during a
crisis is earned before the crisis happens.
Credibility is perhaps the most precious commodity during a crisis.
Investors’ decisions to hold on or jump ship are influenced by reputa-
tion more than we might suspect, even in the financial arena where
profit and loss issues seem determinant. The question from financial
audiences, much as it is with others, becomes, ‘Do I have a basis for
trusting management to give me a true sense of what is going on and,
ultimately, to restore value?’
That said, interaction with institutional shareholders and sell-side
analysts is perhaps the most complex and demanding external rela-
tionship that public company management have to deal with. Most
CEOs and CFOs are ‘on stage’ before these groups, via conference
calls or one-to-one meetings, several times a year to review earnings
and other material developments. In the era of Regulation FD, these
communications now must include financial journalists. The restric-
tions governing financial communication are more stringent than
ever, and management are usually walking a tightrope between saying